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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
With the launch of Kabbage Payments, SME cash flow management solution provider Kabbage is ready to help small businesses get paid, as well as get funded.
“Since 2011, we’ve helped hundreds of thousands of small businesses access over $8 billion in funding,” Kabbage CEO Rob Frohwein said. “We know first-hand a primary need is to cover cash-flow gaps while waiting to be paid.”
Currently available to Kabbage customers and scheduled for public availability “soon,” the new payment solution from Kabbage will feature no-fee, unlimited, online invoicing; next-day deposits; low costs for card payments (cash and check payments free); and a dashboard that provides a view of all payments activity in a single location.
One standout feature of the new solution is a custom pay link that is especially geared toward SMEs that rely on invoice payments. Customers using Kabbage Payments will be able to create a unique URL for their business that enables them to send payment requests by text, email, or the web to collect card payments. With this secure, fast, and flexible option, there is no need to create new accounts manually or open new payment orders, and avoids having to do duplicate work for recurring invoices.
“Kabbage Payments not only expands our suite of products, but the very definition of our company. We deeply believe in the mission of small businesses and understand what they need to succeed – namely, more time building their businesses and less time worrying about cash flow,” Frohwein said.
Businesses interested in the solution can reach out to Kabbage Payments and request early access.
Kabbage demonstrated its Kabbage Card offering at FinovateSpring 2015. Part of the company’s “Kabbage Everywhere” product expansion, the Kabbage Card makes it more convenient for small business owners to use their Kabbage line of credit while on the go. More recently, the company has launched an interactive index analyzing U.S. SME revenue trends, acquired small business insights firm Radius Intelligence, and closed a new, four-year, $200 million revolving credit facility. This transaction followed Kabbage’s massive $700 million securitization – the largest ever by a small business online lending platform – announced this spring.
Earlier this month, Kabbage announced that its customers had accessed more than $715 million in funding via its platform in Q3, and that 42,000+ unique customers were added year-to-date, which tops 2018’s 37,000 total customer gain. At the same time, the company noted that the core of its funding activity comes from repeat customers, who represent more than 75% of all funding activity on the platform and more than $6 billion of the $8+ billion accessed to date.
“It’s essential to have a business model that’s built on scalable long-term growth, and repeat business is a critical metric,” Frohwein said. He praised the platform’s ability to “re-underwrite customers daily,” providing SMEs with a 24/7 source of funding. “Thanks to the speed at which our technology allows us to serve them, we’ve seen record highs,” Frohwein said, “serving nearly 1,900 small businesses who have accessed over $13 million in a single day.”
Founded in 2009, Kabbage is headquartered in Atlanta, Georgia.
Personalized advice, more automation, and “unmatched connectivity” are among the attractions of the new billpay service unveiled by Fiserv today. The new solution, CheckFree Next, enters a competitive billpay space with the backing of Fiserv’s extensive biller network, which includes direct connections with more than 600 billers. With nearly 4,0000 FIs currently using Fiserv’s electronic billpay technology – representing 29 million active billpay users – Fiserv expects its latest offering will provide customers with innovations in billpay not experienced with other solutions.
“Electronic bill payment has become an intrinsic part of many people’s daily lives, however, features that were once cutting edge are now status quo,” Fiserv Enterprise Payment Solutions division president Tom Allanson said. “Knowing that people have higher expectations that never before, we stepped back and challenged ourselves to make paying bills at a financial institution as easy and smart as the best digital experiences people have every day.”
CheckFree Next, which has already been piloted by a pair of “top 10 U.S. financial institutions,” automates a range of basic tasks, and leverages a new Bill Discovery feature that automatically identifies and connects customer billers to their accounts and then establishes the biller as a payee once a match is made. Both payment and data entry are automated to help save bill payers time and reduce the potential for manual errors, and customers can set up billpay reminders and alerts to help them keep better track of upcoming expenses and recent payments. CheckFree Next also features a Withdraw Now capability that gives bill payers control over exactly when a bill payment will be debited from their account.
Fiserv also announced upcoming features to the technology, including real-time money movement, to be added in 2020. This functionality will eventually enable bill payers to make real-time payments – via enhanced notifications – that are reflected instantly in their accounts. These and other features, such as Bill Discovery, will be made available as premium add-ons to Fiserv’s other CheckFree solutions such as CheckFree RXP and CheckFree Builder.
Fiserv demonstrated its technology at FinovateSpring 2018, partnering with Samsung SDS to present its Commercial Center: Security digital banking experience. The company made a huge splash at the beginning of the year with news that it was merging with fellow Finovate alum First Data in a deal valued at $22 billion. Fiserv has been on a busy partner-making pace ever since. In October alone, the company has forged deals with North Carolina-based Uwharrie Bank, Portuguese bank NOVO BANCO, and Toronto, Ontario, Canada’s DUCA Financial Services Credit Union.
Founded in 1984, Fiserv is headquartered in Brookfield, Wisconsin. The NASDAQ listed company (FISV) has a market capitalization of $70 billion. Jeff Yabuki is Chairman and Chief Executive Officer.
This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.
From a renewed focus on holistic financial wellness to the way technologies like predictive analytics can improve financial decision-making, the personal finance management (PFM) space has enjoyed a renaissance in recent years.
We caught up with Om Kundu, founder and CEO of social savings network INSPIRAVE, to find out what his company has been doing to help the average person leverage relationships with friends and family to save smarter. Headquartered in New York City, INSPIRAVE demonstrated its platform at FinovateFall 2016.
Finovate: Among the big news from INSPIRAVE this fall was the fact that you were recently issued a patent. What was the patent for and what does it mean for the company going forward?
Kundu: By combining intelligently planned direct deposits with social gifting and the best savings offers, we have combined the power of three separate solutions of social discovery, savings, and fulfillment into one. This enables INSPIRAVE to be a relentless advocate, and maintain our users’ best interest in mind at every step. INSPIRAVE empowers users to travel from Point-A to Point-B not only by increasing the value of their existing principal, but also by reducing the price-point of their chosen goal whenever possible as part of a thoughtfully orchestrated plan that does not stop until the goal is fulfilled without the risk of credit turning into debt.
Our most recently issued patent is part of a series of filed patents that we expect to be issued internationally. What you see today is V 1.0 of the roadmap (image below) we are furthering for an end-to-end, iTunes-like ecosystem to fundamentally realign retail financial services, commerce and goal-fulfillment. In its simplest form, the systems and methods of the inventions are inspiring users on a journey to fulfill the goals that matter the most to them by setting funds aside over time to make a purchase you may not have afforded otherwise.
The fact that our INSPIRAVE patent has been cited by some of the world’s leading institutions spanning across the Americas (Bank of America) and China (FUZAMEI Tech) should speak for itself on our proprietary technology’s far-reaching scope and scale. The issuance of the patent is a testament to INSPIRAVE having pioneered social savings as much as social commerce.
Looking ahead as part of our roadmap, INSPIRAVE users and partners will benefit from technologies enabling smart contracts for co-ownership/co-access of the merchandise being saved up for. They will also power our SaveAway Pay-It-Forward Scores™, through which we have further aligned incentives for people saving towards their goals and their friends-and-family who have the option — but not the obligation — to contribute.
Finovate: A lot of fintech companies are getting involved in financial wellness, moving beyond PFM. For those who are new to INSPIRAVE, how does your solution differ from other savings-oriented platforms on the market?
Kundu: Far too many solutions in the market today induce more (impulse) spending to qualify for what is often the mirage of saving (i.e., credit card cash-back rewards, or rounding-up a fraction of what you spend into saving). Instead of resuscitating the dying saving muscle, they end up putting the spending muscle on further steroids. Included in these is seemingly “convenient” point-of-sale financing, including those you pay in installments festered with egregious interest rates with credit, that far too often translates into debt.
Yet other card-linked solutions throw advertised offers at you based on your past transactions, which often end up encouraging frivolous purchases and overspending. At a time when the debt crisis is upon us (over $1 trillion in credit card debt alone), we absolutely can and must do better than what retail financial services and commerce often is today: impulsive, punitive, and asocial.
INSPIRAVE stands for that more perfect union – one that aligns fulfillment of goals by users to that of our retail partners who equally benefit from customers, sales, and positive impact they would not have had otherwise. Our singular focus is on helping you “save more, faster,” to fulfill the purchase-goals that matter most, and help you avoid the distractions of the frivolous purchases that don’t.
The result? Even while INSPIRAVE is devoid of advertising, our powerful model is free for end-users (unlike many existing solutions which charge fees for their savings service.)!
Our INSPIRAVE user research indicates in no uncertain terms that “saving for saving’s sake” or saving limited to monetary goals — which is what many solutions today in the market provide — is not intrinsically fulfilling for people. Beyond numerical goals, our goal should be to fulfill experiential goals — i.e., having the purchase-goals that matter the most to us and the people around us delivered at your door.
Finovate: As a social savings network, users of the platform are also critical to the network effect of community-building. Are you seeing these effects in the beta testing of the platform that you are currently doing?
Kundu: INSPIRAVE’s social foundation is borne out in no uncertain terms with over 90% of our users referring other users to the platform. The INSPIRAVE platform’s latest release adds social and direct messaging capabilities making it extraordinarily easy for users to selectively engage their “friends that count” (in contrast to the more public “friend count” or crowd) on purchase decisions.
By cultivating a community of “friends that count,” users not only benefit from social nudges that help them make better purchase-decisions, but also equally increase the likelihood of benefiting from social gifting in the form of monetary contributions from those very same friends. Beyond taking advantage of access to our private beta, our SaveAway program empowers users to recommend their own favorite brands and retailers to join our network. This is making SaveAway a truly democratized marketplace that is equally accessible by well-regarded brands big and small.
Rather than the zero-sum game of getting consumers to “buy more stuff,” INSPIRAVE empowers users to “save more, faster” in ways that enable them to focus on the big purchases that matter most which they wouldn’t have afforded otherwise. In so doing, our SaveAway platform equally unlocks a wholly new channel of underserved customers and sales that expands the total addressable market for retail and financial institutions.
Finovate: How important are partnerships to building the INSPIRAVE community and brand? Who are the other players in fintech that you have synergies with or with whom you might collaborate?
Kundu: Our noteworthy partners run the gamut from Microsoft — which has inducted us into their “Microsoft for Startups” program for The Top Startups in the World — to Stripe, as well as leading e-commerce destinations and retailers including eBay and Best Buy. Given the volume of recent partner inquiries, we are focused on the ones most aligned with our progressive vision. Looking ahead, you can expect to see more of INSPIRAVE’s solutions directly embedded in the retail and e-commerce platforms of our partners.
Finovate: Can you tell us a little about the team you’ve put together and who’ve helped the company get to where it is today?
Kundu: From interns and hires straight out of universities such as Cornell, RIT, Carnegie Mellon, et.al. to senior executives in our board, the common attribute that stands out among them all is this: the courage and the tenacity to solve for tough — and hitherto unsolved — problems. Each one is resolutely focused on alleviating the pain that hundreds of millions are living with, manifest in the staggering amount of consumer debt and gaping holes in financial wellness that get in the way of fulfilling the big goals that truly matter.
Israel-based global venture investing platform OurCrowdannounced a partnership with Toyota Tsusho Corporation today. OurCrowd and the Japanese general trading company – and member of the Toyota Group – have forged a business and technology scouting partnership that will seek out startups innovating in areas that support autonomous driving. This includes services and products leveraging technologies such as sensors, image recognition, data compression, and security.
OurCrowd will serve as a “technology scout” per the arrangement, which will leverage the company’s local and global networks, deal flow pipeline, and roster of portfolio companies to find innovators not just in mobility, but in other areas ranging from smart cities to big data in agriculture, as well.
“We are proud to be partnering with a general trading company such as Toyota Tsusho,” OurCrowd founder and CEO Jon Medved said. “Not only do they represent a 70 year tradition of excellence in global business, but they are focused on solving real global problems. Together we can help startups turn into ‘scaleups’ by providing access to Toyota Tsusho’s unrivaled platform that can deploy new technologies and products quickly and effectively in over 120 markets around the world.”
Toyota Tsusho EVP, Regional CEO and CTO Minoru Murata added that constructive relationships between technology leaders and startups are critical to incumbents, as well. “To ensure our future leadership we must identify, invest, and work with startups who are changing the world we live in,” Murata said.
OurCrowd demonstrated the mobile app for its crowd investing platform for accredited investors at FinovateSpring 2016. Founded in 2013, OurCrowd has $1.2 billion in committed funds, and has invested in 200 portfolio companies and funds. More than 37,000 accredited and institutional investors from 183 countries have funded startups via OurCrowd.
Earlier this month, OurCrowd announced that Stifel Financial Corporation had taken a minority stake in the company. The investment, amount undisclosed, also includes a strategic partnership that will enable Stifel’s investors to access offerings from the OurCrowd platform. Stifel is the 7th largest retail brokerage in the U.S. with more than $300 billion in client assets.
In September, OurCrowd opened an office in Sao Paulo, Brazil, the company’s 13th global location. That month, the company also announced a partnership with Finistere, Tnuva, and Tempo to launch a foodtech incubator. It’s worth noting that OurCrowd’s most recent – and arguably most famous – exit is Beyond Meat, which went public earlier this year.
This summer, in a sign of increasing interest in the U.S., OurCrowd unveiled new offices in Chicago, Illinois, its third in the country.
The buy-now-pay-later e-commerce specialist Splitit has picked up a pair of new partnerships in recent days.
The company announced this week that its Buy Now Pay Later (BNPL) solution will be available across Shopify’s network of 800,000+ merchants in 20 different countries. Splitit also has teamed up with point-of-sale financing company Divido to make its BNPL offering available to the company’s 1,000 banks, merchants, and partners. The Divido integration will go live initially in the U.K., and shortly afterwards launch in the U.S.
“The feedback we consistently receive from merchants is that consumers are looking for better ways to manage their cash flows,” Splitit CEO Brad Paterson said. He highlighted the high number of credit card holders and the upwards of 70% of balances that remain untapped, and said that Splitit provided a better way for consumers to manage cash flow.
Paterson added that improving cash flow for consumers was a good deal for merchants, as well. “By making customer purchases on credit cards more affordable, merchants are also converting more sales and growing their average transaction values, delivering significant benefit to everyone involved,” he explained.
Splitit’s partnership news comes as the company, which debuted at FinovateFall 2014 as PayItSimple, announced a string of agreements with a diverse set of U.S. brands ranging from sleep technology specialists to luxury retailers to accountancy services. Paterson referred to the new agreements as part of the company’s growth strategy in North America, a strategy that also includes plans for new leadership in the region. Current CEO Paterson was previously in charge of North American operations and will relinquish those responsibilities once a replacement is in place.
Over the summer, Splitit announced a partnership with GHL ePayments that will make its installment payment offering available to 2,000+ online merchants in Southeast Asia. Also this year, the company teamed up with EFTPay to bring its buy now pay later solution to merchants in Hong Kong and Macau. Australia-based retailer Kogan announced in July that it would offer Splitit’s payment option, making it the first retailer in the country to do so.
Founded in 2013, Splitit is headquartered in New York. The company has offices in London, and an R&D center in Israel. Splitit has raised more than $43 million in funding, most recently including a post-IPO equity fundraising of $20.5 million (A$30 million) closed in May.
Standard Chartered has selected Thought Machine to provide core banking capabilities for its new digital bank launching in Hong Kong, reports Alex Hamilton of Fintech Futures (Finovate’s sister publication).
The new venture, for which Standard Chartered received a virtual banking license from the Hong Kong Monetary Authority (HKMA), will be unveiled later this year.
According to Deniz Güven, CEO of the as-yet unnamed bank, the selection of the right vendors was a crucial part of building out the bank’s capabilities.
He told FinTech Magazine that Thought Machine would be used as the bank’s “powerful product engine.”
The virtual bank is also using payments processor Paymentology, deploying Netsuite from Oracle and working with FICO to build out its credit business.
According to a May blog post from Güven, it has gone from a core team of ten people to more than 100 members of staff.
“We saw our chance to build a bank with a totally new operating model: new, cloud-based technology from the ground up,” wrote the CEO at the time, “a new way of onboarding clients, new anti-money laundering and fraud systems designed from the client’s viewpoint.”
Thought Machine demonstrated its core banking technology, Vault, at FinovateEurope 2018. Headquartered in London, U.K., and founded in 2014, Thought Machine has raised more than $23 million (£18 million) in funding, and includes Lloyds Banking Group and Backed VC among its investors.
Thought MachineHelps Standard Chartered Launch Digital Bank in Hong Kong.
OurCrowdTeams Up with Toyota in Search for Tech Talent.
Saving for What Matters: A Q&A with INSPIRAVE Founder and CEO Om Kundu.
Around the web
FinovateFall Best of Show winner Cinchyearns $500,000 cash prize as one of the winners of the 2019 VentureClash competition.
Signicatunveils new capabilities, including a new technical interface and new third party integrations, that extend the reach of its digital identity verification technology.
Arkose Labs VP of Marketing and Strategy Vanita Pandey and Senior Producer Hedda Peters winWomen in Cybersecurity honors at the Cyber Defense Global Awards sponsored by Cyber Defense Magazine.
nCinopartners with Seacoast Bank ($8.6 billion in assets).
iProovearns a finalist spot in the 2019 Go:Tech Awards.
Compliance and risk management firm Middesk brings its business verification tool to the Dwolla Partner Ecosystem.
Ping Identityadds to its North European operations with a new office in Utrecht, Netherlands.
This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.
After making inroads into China at the beginning of this month, PayPalannounced another international move today– this time with the U.S.’s friendly neighbors to the north.
The San Francisco-based company has made the PayPal Business Loan for small business owners available in Canada. This isn’t the first time PayPal has launched financing products outside of the U.S. The company also offers loans in the U.K., Australia, Germany, and Mexico.
With this launch, Canada-based small business owners can access from $5,000 to $100,000 in working capital at competitive borrowing rates from terms ranging from 13 to 52 weeks. Businesses can apply online and will receive approval in minutes. Once approved, merchants can receive funds in their business bank account within one to two days.
Before accepting the loan, borrowers can see the transparent cost and fee structure of the loan, including the fixed fee. There are no hidden, origination, late payment, early repayment, or application fees.
“Applying for a traditional loan takes time and isn’t always favorable to small business owners,” said President of PayPal Canada, Paul Parisi. “We’re launching the PayPal Business Loan to offer our merchants easy access to financing, something they desperately need. We look forward to helping more small business owners achieve their dreams to grow locally and globally.”
This news comes almost six years after PayPal began offering business financing solutions. Since that time the company– which was founded in 1998– has provided $10+ billion in funding to nearly a quarter of a million business owners around the world. PayPal reports that historically, the most common uses of the loans include managing cash-flow (44%), purchasing inventory (37%) and investing in marketing (31%).
The loans are currently available to select Canadian business owners by invitation only. PayPal will make the loans available to all Canadian PayPal business account holders next year.
PayPal showcased its Instant Account Creation feature at FinovateFall 2012. The company, which made its 19th acquisition earlier this month, has a market capitalization of $116 billion.
Nigeria-based Union Systems is the latest company to team up with global biometric identity technology innovator Daon. The African fintech will help bring Daon’s “two-in-one,” cross-channel authentication and digital onboarding technology to financial institutions across the African continent.
“This partnership with Daon puts us at the forefront of the efforts by the regulatory authorities to combat financial crimes,” Union Systems CEO Chuks Onyebuchi said. “Daon’s technology is cutting-edge, and will redefine authentication and digital onboarding as we know it.”
Daon’s IdentityX platform enables new users to leverage credentials established during the onboarding process for ongoing authentication. This “two-in-one” approach removes friction and accelerates time to revenue by activating customers faster. The platform provides the highest level of security via mobile, web, and call center authentication, and is FIDO certified.
“Working collaboratively with Union Systems Limited, we will make our leading identity technology available to an ever-growing wave of African innovators, particularly those in financial services who want to reach more customers and differentiate themselves with a secure and seamless experience,” Daon CEO Tom Grissen said. “We are excited to bring our authentication and digital onboarding capabilities to Union Systems customers and expand our product offering throughout the African market.”
Daon demonstrated its universal mobile biometric authentication platform at FinovateFall 2016. The solution leverages device binding, geolocation, liveness detection, and other technologies to provide a seamless, inherently multi-factor, authentication experience. Earlier this year, Daon unveiled a suite of new features for its onboarding solution, including browser-based onboarding, third-party identity checks, automated decisioning, and optional human review.
Last month, Daon announced that John Sanders, co-founder of Reveal Imaging Technologies (acquired by SAIC), would join the company as President of Emerging Markets. Sanders will be tasked with helping lead the company through its next phase of growth into new verticals, and will also be a member of Daon’s board of directors.
The Reston, Virginia-based company announced a pair of partnerships over the summer. In July, Daon collaborated with digital onboarding and anti-fraud specialist CTMS in a partnership that will make Daon’s biometric security technology available to FIs and businesses in France. The same month, Daon and North African technology firm GEMADEC announced they had successfully set up a mobile application for the Moroccan Interprofessional Pension Fund (CIMR). The app uses facial recognition as part of a life certificate digitalization that establishes proof-of-life.
According to Tolerisk founder and CEO Mark Friedenthal, the newly-announced integration between his company and SS&C’s Black Diamond Wealth Platform will make it easier for advisors to help clients reach their financial goals. The integration will bring sophisticated risk assessment technology to the portfolio management platform, and provide advisors with the ability to more objectively and more comprehensively measure client risk appetites.
“Our focus on providing the best analytical solutions for advisors includes seamless delivery that comes from integrations with leading providers of financial planning, portfolio reporting, portfolio analytics, and CRM technologies,” Friedenthal said.
Specific features of the integration include the ability to post custom notes directly to the Black Diamond Relationship Timeline, as well as client import and mapping functionality to help advisors generate risk assessments and send them to clients quickly and more efficiently. Customers using both systems will be able to leverage additional compatibilities, such as the ability to import client account balances into Tolerisk for faster updating and less manual input.
“Our integration with Tolerisk makes it easy to leverage the power of both tools in a unified way,” Head of Partnerships and Integrations for Black Diamond at SS&Cs Justin Wayne said. “Together, we are empowering advisors to have more meaningful conversations with their clients, which deepens the advisor-investor relationship and provides a competitive advantage.”
Founded in 2014 and headquartered in New Jersey, Tolerisk demonstrated its Tolerisk 401(k) solution at FinovateFall 2018. The feature leverages Tolerisk’s deep analytics and two-dimensional risk tolerance assessment capabilities to offer customized financial planning advice to customers. The company’s technology not only helps identify a client’s risk profile with its Tolerisk Score feature, it also provides critical Probability of Running Out of Money reports to ensure a client’s withdrawal strategy does not diminish available savings at too rapid a rate.
Tolerisk’s Friedenthal was featured this spring in the New York Times article “When Gambling Seems Like a Good Investment Strategy.” Tolerisk began the year with big partnership news, inking deals with Orion Advisor Tech in February and CircleBlack in January.
After receiving its banking license from the Bank of Spain last week, personal finance platform Fintonic has become Spain’s newest challenger bank. Having passed all of the certifications, Fintonic is now a payment initiation service provider (PISP) and PSD2 compliant account aggregation service provider (AISP).
“We are very pleased to be pioneers in receiving this license, because it supports our value proposition to always be next to our users helping them with total transparency,” said Lupina Iturriaga, founder and co-CEO of Fintonic.
By becoming a PISP and AISP, the company anticipates it will be able to launch products and services that offer its 800,000 users a better way to manage their money. “Our ambition is to offer an ideal financial service with a platform that integrates different entities while maintaining the standards of independence and transparency promoted by Fintonic,” added Iturriaga.
Fintonic’s flagship offerings include financial management tools, insurance, and lending, which allows customers to take out loans of up to $45,000 (€40,000). The company recently revealed other plans in the works– including account-to-account transfers that happen in near-real time. By the end of this year, Fintonic’s goal is to amass one million users.
At FinovateSpring 2016, Fintonic debuted its alerts and inbox system to help users act in a timely manner on their financial needs and recommendations. The company, which recently received a $21.4 million investment, has $51 million in total funding and, earlier this year, was valued at $180 million.
